Digital payments have witnessed tremendous growth in recent years, transforming the way transactions are conducted in India. With the rapid advancements in technology and the government’s push towards a cashless economy, various payment systems have emerged. Two prominent systems that have revolutionized the digital payments landscape in India are the Open Network for Digital Commerce (ONDC) and the Unified Payments Interface (UPI). In this blog post, we will delve into the details of both ONDC and UPI, highlighting their differences and exploring their impact on the Indian economy.
Difference Between ONDC and UPI
Here is a table highlighting the differences between ONDC and UPI:
|Feature||Open Network for Digital Commerce (ONDC)||Unified Payments Interface (UPI)|
|Purpose||A government-backed initiative that connects buyers and sellers for online shopping.||A payment system that simplifies money transfers and payments across various platforms.|
|Supported by||Supported by the Indian government and the Department for Promotion of Industry and Internal Trade (DPIIT).||Supported by multiple banks and payment service providers in India.|
|Pricing||Offers competitive prices and discounts on the Paytm platform.||Pricing varies based on the service or transaction, determined by the individual bank or payment service provider.|
|Support for Small Businesses||Empowers small businesses by providing a common platform for them to reach a wider customer base and compete effectively with larger e-commerce players.||Focuses primarily on payment functionality rather than supporting small businesses directly|
|Customer Support||Provides dedicated customer support within the app to address user concerns and queries related to orders and services.||Customer support may vary depending on the platform or service used within UPI|
|Transaction Options||Offers various transaction options, including online shopping, food delivery, and other services through a single platform.||Provides multiple options for money transfers: QR code scanning, transfer to mobile/contact, UPI apps, and bank accounts.|
|Security||Ensures a secure platform backed by the Indian government, offering trust and reliability to users.||UPI transactions require a secure UPI PIN for authentication, adding an extra layer of security to prevent unauthorized access.|
Detailed Difference Between ONDC and UPI
Here are the key differences between ONDC and UPI:
- ONDC: It is a government-backed initiative that connects buyers and sellers in the online shopping domain, providing a common platform for various vendors.
- UPI: It is a payment system that simplifies money transfers and payments across multiple platforms, allowing users to make transactions using UPI IDs, mobile numbers, or QR codes.
- ONDC: It is supported by the Indian government and the Department for Promotion of Industry and Internal Trade (DPIIT).
- UPI: It is supported by multiple banks and payment service providers in India.
- ONDC: It offers competitive prices and may provide discounts on the specific platform it operates, such as Paytm.
- UPI: Pricing varies based on the individual bank or payment service provider, which determines the fees and charges for UPI transactions.
- Support for Small Businesses:
- ONDC: It empowers small businesses by integrating them into a common platform, allowing them to reach a larger customer base and compete with larger e-commerce players.
- UPI: While UPI primarily focuses on payment functionality, it indirectly supports small businesses by facilitating faster and more convenient transactions.
- Customer Support:
- ONDC: It provides dedicated customer support within the app, assisting users with order tracking, payment issues, and general inquiries.
- UPI: Customer support may vary depending on the platform or service used within UPI, and it is typically provided by the individual banks or payment service providers.
- Transaction Options:
- ONDC: It offers various transaction options, including online shopping, food delivery, and other services, accessible through a single platform.
- UPI: It provides multiple options for money transfers, such as scanning QR codes, transferring funds to mobile/contact numbers, sending money to UPI apps, or transferring to bank accounts.
- ONDC: It is backed by the Indian government, providing a secure platform that assures trust and reliability to users.
- UPI: UPI transactions require a secure UPI PIN for authentication, adding an extra layer of security to prevent unauthorized access to the user’s account.
What is ONDC?
The Open Network for Digital Commerce (ONDC) is a government-backed initiative in India that acts as a middleman connecting buyers and sellers in the world of online shopping. It functions similar to the Unified Payment Interface (UPI), allowing users to access a wide range of products and services from various vendors through a single platform. ONDC brings together different providers, offering users increased choices, competitive prices, and fostering healthy competition.
Features of ONDC
The features of ONDC include:
- Increased choice and competition: ONDC brings together multiple e-commerce sellers, providing consumers with a broader range of choices at competitive prices. Users can explore various products and services from small local businesses to well-known food chains, grocery stores, home decor, electronics, and more.
- Lower prices: One of the significant benefits of ONDC is its relatively lower prices compared to other food delivery applications. This affordability helps users save money on their orders, making it an attractive option for cost-conscious individuals and families.
- Discounts and promotions: ONDC, particularly on Paytm, offers promotional deals and discounts to its users. These can include discounts on specific restaurants or menu items, free delivery, or special seasonal offers, further enhancing the affordability and savings for users.
- Support for small businesses: ONDC empowers small businesses and local vendors by integrating them into the common platform. It provides them with the opportunity to reach a larger customer base, expand their visibility, and compete effectively with larger e-commerce players. Customers also benefit from accessing a wide range of products that may not be available on traditional e-commerce sites but are easily found locally.
- Government-backed initiative: ONDC enjoys the support of the Department for Promotion of Industry and Internal Trade (DPIIT) of the Government of India. This government backing provides credibility and assurance to users, ensuring a trustworthy and reliable platform.
- Customer support: ONDC integrates dedicated customer support within the app to promptly address any concerns or queries users may have. Users can easily reach out to the support team for assistance with order tracking, payment issues, or general inquiries, ensuring a seamless and satisfactory user experience.
Also Read: Save Big Using ONDC For Food and Groceries
How to Use ONDC on Paytm?
To use ONDC for ordering food and groceries on Paytm, users can follow these steps:
- Log into the Paytm app using your credentials.
- Enter ‘ONDC’ in the search bar or scroll down to find ‘Paytm se ONDC’ for quick access.
- Explore the available options in categories such as food, grocery, home decor, and electronics.
- Choose a specific restaurant or menu and select the desired items to add to your cart.
- Proceed to the cart and select your delivery address, confirming it on the map.
- Apply any applicable coupon code and proceed to the payment stage.
- Choose your preferred payment method from the available options.
- Enter the PIN associated with your payment method to complete the food order.
- After a successful transaction, you will receive a notification on your registered mobile number.
What is UPI?
Unified Payments Interface (UPI) is a payment system in India that simplifies money transfers by eliminating the need for complex information. Instead of providing details like the receiver’s name, contact number, bank account number, and IFSC code, UPI allows users to make payments using a unique UPI ID, mobile number, or QR code. The UPI ID serves as a virtual address for online transactions and money transfers.
Features of UPI
- UPI ID: Every UPI user is assigned a unique UPI ID, which serves as a virtual payment address (VPA). It eliminates the need for sharing sensitive information like bank account numbers during transactions.
- Seamless integration: UPI can be seamlessly integrated into different payment apps, providing users with a unified interface to access and manage their bank accounts.
- Multiple transaction options: UPI offers various transaction options such as scanning QR codes, transferring funds to mobile or contact numbers, sending money to UPI apps, or transferring to bank accounts.
- UPI PIN: UPI transactions require a UPI PIN, which acts as a secure authentication method. It adds an extra layer of security to prevent unauthorized access to the user’s account.
How to Use UPI ID to Send Money?
Here are the steps to use UPI on Paytm:
- Log in to the Paytm app.
- Go to the “UPI Money Transfer” section.
- Choose an option: “Scan & Pay,” “To Mobile or Contact,” “To UPI Apps,” or “To Bank or Self A/C.”
- Select the recipient from your phone contacts or enter their mobile number if not saved.
- If the recipient uses a different app, ask for their UPI ID and enter it.
- Choose the bank account for the transfer and click “Proceed.”
- Enter the UPI PIN associated with the selected bank account.
- The amount will be immediately transferred from your bank account to the recipient’s bank account.
Suggested Read – What Is Paytm UPI Reference Number and How Can You Track It?
ONDC and UPI are two significant players in India’s digital payment landscape. While UPI revolutionizes money transfers and payments, ONDC serves as a platform connecting buyers and sellers for online shopping. ONDC empowers small businesses, provides increased choices, competitive prices, and discounts, while UPI simplifies transactions through UPI IDs, mobile numbers, and QR codes. Together, these systems have transformed the way transactions are conducted in India, fostering a cashless economy and benefiting businesses and consumers alike.